Alexandria, VA Estate Planning Blog

A special needs trust is a special trust that allocates trust assets for the benefit of a person who has special needs and is (or may likely be) Medicaid eligible. Special Needs Trusts may take many forms. For estate planning purposes, Special Needs Trusts generally are drafted so that the special needs beneficiary may receive distributions of trust income and trust principal without having the trust principal or trust income being considered countable (as assets or income) for Medicaid eligibility purposes.

Special needs trusts are not overly complicated to draft. Well drafted asset protected trusts often have dynastic provisions that protect beneficiaries’ who may possibly Medicaid eligibility even when Medicaid doesn't appear to be an immediate issue. If you are interested in estate planning for a special needs beneficiary, or have questions about special needs trusts, feel welcome to contact the firm.

Note Special Needs Trusts frequently are referred to as Supplemental Needs Trusts when a trust grantor creates the trust for the benefit of a third party special needs beneficiary (as opposed to the grantor being a special needs beneficiary)